Archive for the ‘Privatization’ Category

If you haven’t heard, the new concern on Capitol Hill is The Highway Trust Fund. Without an increase in taxes or, dare I say, a decrease in spending, the fund will be depleted by August 1st 2014. Examining the issue though, would this really be such a terrible thing?

Have you ever wondered what would happen if the building of roads and streets was privatized? Probably not, because, let’s face it, you’re likely a relatively normal person who has innocently stumbled across this blog. However, since you’re here now, give it a moment’s thought. What ideas or concerns pop into your head? No really, think about it!

…

…

…

Done? Good.

Did you envision roads leading nowhere or right up to businesses but not away? Perhaps you anticipated a mix of chaotic and confusing road rules resulting in 5-mile pileups. (I encourage you to leave any of your ideas in the comments below)

Here’s a short incomplete list of what I foresee:

No more frustrating bumper-to-bumper traffic jams

No more four-way intersections

No more waiting countless minutes for your light to turn green

Far fewer car accidents/deaths

Improved road conditions

I know, I know…a few crayons short of a Crayola box, but hear me out. Unlike the government, road owners would have to receive funding by actually meeting consumers’ desires. To demonstrate, let’s look at how the government is currently performing in regards to customer satisfaction. Starting off, even with a Department of Transportation budget of 77 Billion dollars, only 31% of the Nation’s roads are considered to be in “good” condition.¹ In 2011, 35k people died in vehicle accidents, making it number 12 on the Center for Disease Control’s list of the leading causes of death (number 2 if you remove diseases from that list and number 1 if you break “Accidents” out into it’s individual components).² Compare this to the 4400 occupational fatalities, of which roughly 1000 are still contributed to “roadway incidents involving motorized land vehicles.”³

I brought in the last bit about occupational deaths to show that, generally speaking, private industries sort of rely on keeping its customers and workers alive. Workers and customers tend to flee to competitors or demand high premiums when they hear about absurd death tolls in a particular industry. Sadly, when it comes to government provided services, we aren’t given a choice. Thus, we have a government provided service as the number 1 non-disease killing source and no alternatives to choose from!

In addition to this, private industries have something the governments never have: price signals. When a private industry performs well and provides customers with the desired services, they see a profit. When they fail to do so, they suffer losses or see gains to competitors. Using these signals, road builders would be able to determine where roads should be built, the number of lanes that should be provided, speeds for each area, safety levels, and so much more. Ultimately, it would be the users of these roads that help entrepreneurs determine what society is demanding in regards to product safety, quality, and cost. It is because the government lacks such data that they cannot tell whether they are producing too much or too little of the product, using the correct combination and amount of resources, selling in the right area, or even producing what’s desired.

So give it some thought again. Should we really be allowing more of our money to go towards governmental maintenance of roads? Shouldn’t we start looking for the alternative solution that’s ultimately concerned about the consumers’ desires and safety? Shouldn’t we start asking Publix and Disney to build our roads and highways?